Af­ter the Uber rul­ing

Los Angeles Times - - OPINION -

Are­cent de­ci­sion by the Cal­i­for­nia La­bor Com­mis­sioner’s of­fice shows how poorly the state’s ag­ing la­bor laws fit some 21st cen­tury work­places. A for­mer Uber driver de­manded re­im­burse­ment for ex­penses the com­pany re­quires driv­ers to ab­sorb, claim­ing that she should have been treated as an em­ployee in­stead of an in­de­pen­dent con­trac­tor. A hear­ing of­fi­cer for the com­mis­sioner agreed, cit­ing the con­trol Uber ex­erts over the de­tails of its busi­ness. Although the rul­ing, which Uber is ap­peal­ing, would af­fect only that one driver, the same rea­son­ing could be ap­plied by the com­mis­sioner or the courts to other Uber em­ploy­ees and smart­phone- based ser­vices.

Here’s why that’s trou­bling. These new ser­vices are more than just a cheaper al­ter­na­tive to tra­di­tional providers. They’re a break­through for peo­ple who have some­thing to of­fer the public but no way to do so ef­fec­tively on their own. The emer­gence of spe­cial­ized plat­forms such as Uber, Taskrab­bit and In­stacart has drawn enough cus­tomers and providers to make it vi­able for peo­ple to of­fer a ser­vice on their own sched­ule, for as many or as few hours per week as they choose.

State law, how­ever, doesn’t care about such dis­tinc­tions. It fo­cuses on whether the work­ers are en­gaged in the same busi­ness as the com­pany they’re work­ing for, and if so, how much con­trol they wield over the jobs per­formed. Be­cause Uber sets the price of its ser­vice and nu­mer­ous other de­tails, the hear­ing of­fi­cer held that the driver was an em­ployee — even though Uber didn’t tell her how much or how lit­tle to work, where to do so or when.

The state’s rules are valu­able when it comes to stop­ping com­pa­nies from clas­si­fy­ing work­ers as in­de­pen­dent con­trac­tors sim­ply to avoid the costs as­so­ci­ated with em­ploy­ees, such as state- man­dated work­ers’ com­pen­sa­tion and un­em­ploy­ment in­sur­ance. That fight has been go­ing on for decades across many in­dus­tries. But with a grow­ing num­ber of Cal­i­for­ni­ans look­ing for part- time, tem­po­rary or en­tre­pre­neur­ial work, the state can’t af­ford to close off op­por­tu­ni­ties for those who prize flex­i­bil­ity over job se­cu­rity, and who need the help of a plat­form such as Uber’s to sell their ser­vices. Cal­i­for­nia re­quires a new ap­proach that would al­low peo­ple to con­tract out their ser­vices in­de­pen­dently through new plat­forms with­out en­abling com­pa­nies to mag­i­cally trans­form em­ploy­ees into con­trac­tors with fewer ben­e­fits and no safety net. Sug­ges­tions for how to do so are be­gin­ning to cir­cu­late, and state law­mak­ers should start ex­plor­ing them now.

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